China and the United States have a thorny relationship, the natural byproduct of two countries reluctantly dependent on each other economically, but diametrically opposed in political philosophy. Despite their differences, the two nations are intricately connected, and sometimes, to keep the waters smooth, something has to give. Yesterday, Vice President Joe Biden announced that China would allow a substantial increase in market access for U.S. movies, opening the door for more U.S. exports to the East, and more fair remuneration for American film companies whose films are being shown in China. Sounds like everybody’s getting along, right?

Not quite. Yesterday’s announcement was a compromise deal precipitated by a successful legal action in the World Trade Organization that the U.S. has been pursuing against China since 2007. In 2009, the WTO ruled that China’s strict quota system on film imports (only 20 foreign films are allowed into the country each year) violated the country’s obligations under the body’s trade regulations. China unsuccessfuly appealed the decision, and was ordered to end its quota system by March 2011, a deadline that it later informed the U.S. it would not make.

Under the new rules, China will allow 14 ‘premium format films’ (for example, IMAX or 3-D) to be exempt from the 20-film quota, which will continue to stand. In addition, U.S. studios will earn 25% of box office share, as opposed to the 13% they earned before. The Motion Picture Association of America praised the new agreement, saying it would allow 50% more U.S. films into China. Chinese box office revenue last year was $2.1 billion.

This deal will probably be good news for Hollywood, significantly expanding its market in a crucial growing economy. There’s also no denying that Beijing and Hollywood have deepened their ties in the last few years. The Chinese government is setting up a new film venture with offices in Beverly Hills and Beijing; Friday morning, Chinese Vice President Xi Jinping was in Hollywood to attend a presentation unavailing DreamWorks’s plan to build a Shanghai animation studio along with two Chinese state-owned media companies.

Still, the relationship between Beijing and Hollywood isn’t all rosy. Just two days ago, actor Christian Bale, who was in China to attend the premiere of his most recent film, “The Flowers of War,” decided to take an eight-hour car trip to visit Chen Guangcheng, a blind self-taught lawyer turned activist who has been held under house arrest by the government. Upon arriving in the small town, Bale was met by Chinese authorities, roughed up, and literally chased out of Dodge. Unfortunately for the regime, the actor was traveling with a CNN film crew, which caught the entire altercation on tape.

It’s fairly clear that Bale’s working relationship with China is now abruptly over. Foreign Ministry spokesman Liu Weimin, when asked about the actor’s visit to Chen, told reporters, “He was not invited to create a story or shoot film in a certain village. I think if you want to make up news in China, you will not be welcome here.” (How Bale, and not the government, was ‘making up’ news in this case is really anyone’s guess.)

Bringing a delicious irony to the entire episode is the fact that Bale had been criticized in some circles for his very involvement in “Flowers of War.” The most expensive film in China’s history, the movie portrays a stridently pro-Chinese perspective on the contentious Nanjing Massacre that followed the capture of Nanjing by the Japanese during the Second Sino-Japanese War. The film’s director, Zhang Yimou, is a favorite of China’s Communist party.

This isn’t the first time that American filmmakers have been rebuked by China’s rulers. Producing giant Harvey Weinstein was forced to look outside of the country to film his period epic “Shanghai” after the Chinese government revoked filming permits, wary of another controversial movie being filmed there, as was Ang Lee’s “Lust, Caution.” Weinstein’s film has yet to be released in the U.S., despite having its premiere in Hong Kong in the fall of 2010.

Last October, we wrote here on TOH about the beginning of principal photography on Relativity Media’s first Chinese co-venture, the low-budget comedy “21 and Over.” Just days later, the company came under fire from human rights activitsts for filming in Linyi, the very town, incidentially, where Chen lives and where Bale was roughed up by Chinese authorities.

As the Los Angeles Times notes, Bale joins a list of frowned-upon filmmakers in China that includes some heavy hitters:

Richard Gere is persona non grata for his longtime activism on behalf of Tibetan independence. Sharon Stone’s films have not been shown since her offhand remark at the 2008 Cannes Film Festival suggesting that a devastating earthquake in China that year was “karma” in retribution for the treatment of Tibetans.

Steven Spielberg was one of the first Hollywood directors to work in China, going to Shanghai to shoot 1987’s “Empire of the Sun,” which featured a young Christian Bale. But Spielberg also fell from grace after withdrawing as an artistic advisor to the 2008 Beijing Olympics in protest of Chinese policy in Sudan. His films are still shown here, but he hasn’t been invited back.

Nonetheless, it will be interesting to see if the actor is ever invited back into the country for another project.

See below for the CNN report on Bale’s treatment at the hands of Chinese security personnel.